Social Impact Investing

advance with the practice of CSR while adding value to the firm. On the other hand,
property rights may be more relevant to conservative CEOs. Since conservatives tend
to value free markets, individualism and call for a respect of authority, they will not likely
envision this practice as often as those identifying as liberals might.
The financials of the company and the practice of CSR also have a positive relationship.
Moreover, the performance of a company tends to influence conservatives more likely
than liberals. While not seeing it from the financial performance point of view, liberals
tend to hold a view that CSR adds to the business triple bottom line. For instance, when
the company is performing well, they will most likely promote CSR. If the company is not
performing as expected, they will rather tend to emphasize this practice because they
will potentially envision it as a way to add value to the business. In contrast, politically
conservative CEOs will tend to support the practice of CSR if they hold a view that it will
provide a good return to the financials of the company. In other words, this type of
executives tend to not see the outcome of CSR as a value to the company if it does not
provide anything in exchange.
Misdirection
There have been unsubstantiated social efforts, ethical claims, and outright
greenwashing by some companies that has resulted in increasing consumer cynicism
and mistrust. Sometimes companies use CSR to direct public attention away from other,
harmful business practices. For example, McDonald's Corporation positioned its
association with Ronald McDonald House and other children's charities as CSR while its
meals have been accused of promoting poor eating habits.
Acts which may initially appear to be altruistic CSR may have ulterior motives. The
funding of scientific research projects has been used as a source of misdirection by
firms. Prusiner, who discovered the protein responsible of CJD and won of the 1997
Nobel prize in Medicine, thanks the tobacco company RJ Reynolds for their crucial
support. RJ Reynolds funded the research into CJD. Proctor states that "the tobacco
industry was the leading funder of research into genetics, viruses, immunology, air
pollution" anything which formed a distraction from the well-established research linking
smoking and cancer.
Research has also found that corporate social marketing, a form of CSR promoting
societal good, is being used to direct criticism away from the damaging practices of the
alcohol industry. It has been shown that adverts which supposedly encourage
responsible drinking simultaneously aim to promote drinking as a social norm.
Companies may engage in CSR and social marketing in this case to prevent more
stringent government legislation on alcohol marketing.
Controversial Industries
Industries such as tobacco, alcohol or munitions firms make products that damage their
consumers or the environment. Such firms may engage in the same philanthropic
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